Latest news with #DeutscheMark
Time of India
08-07-2025
- Business
- Time of India
Trade tensions, not BRICS, are the bigger threat to global stability: Geoff Dennis
"The Chinese are desperate for the RMB to play a bigger role. But frankly, I do not see what the BRICS are doing or what they are trying to do represents a currency related threat to the US whatsoever," says Geoff Dennis , Independent EM Commentator. When we speak about the idea of de-dollarisation and we have seen countries like India for instance, we have publicly stated that we are not going to move away from the dollar and de-dollarisation is not a policy that India essentially is looking at. But is there an immediate threat to the United States or to the G7 group of nations from BRICS because Donald Trump is making these comments over and over again. So, do you anticipate an immediate threat A) to the dollar and, of course, to US' hegemony? Geoff Dennis: I do not believe so. This is an issue which has allegedly impacted markets for the best part of 50 years. I am an old guy, I have been around a long time and we were talking about potentially the Deutsche Mark replacing the US dollar as a key reserve currency or the key reserve currency in the late 70s and it has just never happened. Now, right now there is some evidence, of course, that central banks are diversifying out of the dollar. The Chinese are desperate for the RMB to play a bigger role. But frankly, I do not see what the BRICS are doing or what they are trying to do represents a currency related threat to the US whatsoever. I just do not get it frankly. And so, there is some de-dollarisation going on for sure, but I am not sure it is major and I am not sure it is involving the BRICS. In fact, frankly, my own interpretation of all of this is that anything that anybody does overseas, especially if countries get together is almost automatically defined by Trump is anti-America and there is nothing about what the BRICS are doing that is really seriously anti-America and this all boils down at the end of the day to the fact that I just think de-dollarisation is not something that is going to go far in the world even if the dollar's really truly dominant position has pulled back a little bit over the last few years. Given the fact that the reform Bretton Woods and reduce dollar reliance in fact is not new, but is BRICS gaining structural momentum this time in your opinion? Geoff Dennis: It is gaining structural momentum in the sense that you have got a number of other large countries as everybody knows joining BRICS that over and above the original BRICS which was defined by my old friend Jim O'Neill in 2001 which was, of course, just Brazil, Russia, India, China. There are some very important countries that have joined. But still I am not sure exactly what a BRICS summit achieves. Yes, they say all the right things about we support free trade. We condemn tariffs whatever it might be or non-tariff barriers, but as to how much power this group actually can demonstrate currently in the world economy especially against a US president who frankly is a bully to everybody who seems to threaten in some vague way the US dominant position of the world economy. Live Events So, I think it does not sort of matter to me within reason what the BRICS does at this point, whether it gets bigger, whether it gets smaller, whether a lot of presidents and heads of state come to the conferences or not. At the end of the day I do not think it has a lot of power except to say all the right things about trade policy and meanwhile President Trump is rampaging around the global economy like a bull in a China shop and the BRICS will become part of that unfortunately and yet, I do not know how the BRICS particularly fights back and I certainly do not see it as I said earlier being something that is going to turn into a brics-led currency, whatever reserve currency that is going to replace the dollar. The problem here is Trump's tariff policy and it is as simple as that frankly. ETMarkets WhatsApp channel )
Economic Times
08-07-2025
- Business
- Economic Times
Trade tensions, not BRICS, are the bigger threat to global stability: Geoff Dennis
The problem here is Trump's tariff policy and it is as simple as that frankly. Synopsis Geoff Dennis, an Independent EM Commentator, dismisses the notion of BRICS posing a currency threat to the US, despite China's desire for a stronger RMB. While some de-dollarization exists, Dennis believes Trump's perception of any overseas collaboration as anti-American is a key factor. "The Chinese are desperate for the RMB to play a bigger role. But frankly, I do not see what the BRICS are doing or what they are trying to do represents a currency related threat to the US whatsoever," says Geoff Dennis, Independent EM Commentator. ADVERTISEMENT When we speak about the idea of de-dollarisation and we have seen countries like India for instance, we have publicly stated that we are not going to move away from the dollar and de-dollarisation is not a policy that India essentially is looking at. But is there an immediate threat to the United States or to the G7 group of nations from BRICS because Donald Trump is making these comments over and over again. So, do you anticipate an immediate threat A) to the dollar and, of course, to US' hegemony? Geoff Dennis: I do not believe so. This is an issue which has allegedly impacted markets for the best part of 50 years. I am an old guy, I have been around a long time and we were talking about potentially the Deutsche Mark replacing the US dollar as a key reserve currency or the key reserve currency in the late 70s and it has just never happened. Now, right now there is some evidence, of course, that central banks are diversifying out of the dollar. The Chinese are desperate for the RMB to play a bigger role. But frankly, I do not see what the BRICS are doing or what they are trying to do represents a currency related threat to the US whatsoever. I just do not get it frankly. And so, there is some de-dollarisation going on for sure, but I am not sure it is major and I am not sure it is involving the BRICS. In fact, frankly, my own interpretation of all of this is that anything that anybody does overseas, especially if countries get together is almost automatically defined by Trump is anti-America and there is nothing about what the BRICS are doing that is really seriously anti-America and this all boils down at the end of the day to the fact that I just think de-dollarisation is not something that is going to go far in the world even if the dollar's really truly dominant position has pulled back a little bit over the last few years. Given the fact that the reform Bretton Woods and reduce dollar reliance in fact is not new, but is BRICS gaining structural momentum this time in your opinion? Geoff Dennis: It is gaining structural momentum in the sense that you have got a number of other large countries as everybody knows joining BRICS that over and above the original BRICS which was defined by my old friend Jim O'Neill in 2001 which was, of course, just Brazil, Russia, India, China. There are some very important countries that have joined. But still I am not sure exactly what a BRICS summit achieves. Yes, they say all the right things about we support free trade. We condemn tariffs whatever it might be or non-tariff barriers, but as to how much power this group actually can demonstrate currently in the world economy especially against a US president who frankly is a bully to everybody who seems to threaten in some vague way the US dominant position of the world economy. So, I think it does not sort of matter to me within reason what the BRICS does at this point, whether it gets bigger, whether it gets smaller, whether a lot of presidents and heads of state come to the conferences or not. ADVERTISEMENT At the end of the day I do not think it has a lot of power except to say all the right things about trade policy and meanwhile President Trump is rampaging around the global economy like a bull in a China shop and the BRICS will become part of that unfortunately and yet, I do not know how the BRICS particularly fights back and I certainly do not see it as I said earlier being something that is going to turn into a brics-led currency, whatever reserve currency that is going to replace the dollar. The problem here is Trump's tariff policy and it is as simple as that frankly. (You can now subscribe to our ETMarkets WhatsApp channel) BRICSGeoff Denniscurrency threat to USRMBUS hegemony Nikita Papers IPO opens on May 27, price band set at Rs 95-104 per share Nikita Papers IPO opens on May 27, price band set at Rs 95-104 per share Why gold prices could surpass $4,000: JP Morgan's bullish outlook explained Why gold prices could surpass $4,000: JP Morgan's bullish outlook explained Cyient shares fall over 9% after Q4 profit declines, core business underperforms Cyient shares fall over 9% after Q4 profit declines, core business underperforms L&T Technology Services shares slide 7% after Q4 profit dips L&T Technology Services shares slide 7% after Q4 profit dips Trump-Powell standoff puts U.S. Rate policy in crosshairs: Who will blink first? Trump-Powell standoff puts U.S. Rate policy in crosshairs: Who will blink first? SEBI warns of securities market frauds via YouTube, Facebook, X and more SEBI warns of securities market frauds via YouTube, Facebook, X and more API Trading for All: Pi42 CTO Satish Mishra on How Pi42 is Empowering Retail Traders API Trading for All: Pi42 CTO Satish Mishra on How Pi42 is Empowering Retail Traders Security, transparency, and innovation: What sets Pi42 apart in crypto trading Security, transparency, and innovation: What sets Pi42 apart in crypto trading Bitcoin, Ethereum, or Altcoins? How investors are structuring their crypto portfolios, Avinash Shekhar explains Bitcoin, Ethereum, or Altcoins? How investors are structuring their crypto portfolios, Avinash Shekhar explains The rise of Crypto Futures in India: Leverage, tax efficiency, and market maturity, Avinash Shekhar of Pi42 explains NEXT STORY
Yahoo
26-04-2025
- Business
- Yahoo
The truth about the dollar's decline: ‘You'll either have to raise prices, or lower profits'
In today's CEO Daily: Peter Vanham talks to LSE's Paul De Grauwe about the declining reputation of the dollar. The big story: More signs of compromise in the trade war. The markets: Mostly up! Analyst notes from Apollo on the dollar, Wedbush on AI capex, Macquarie on China, and Goldman Sachs on GDP. Plus: All the news and watercooler chat from Fortune. Good morning. The threat of prohibitive 'reciprocal' tariffs may have temporarily receded this week, but in one way, a 10 percent barrier for foreign companies exporting to the U.S. remains in place: the U.S. dollar dropped in value by about a tenth against a basket of currencies in the last few weeks, including against the euro, pound, Swiss franc, and yen. President Trump has long believed that a strong dollar hurts U.S. manufacturers—making their goods less affordable in foreign markets—and has therefore wanted to devalue it. Despite the dollar being free-floating, it is one area where Trump's wishes have been self-fulfilling, to a degree. His on-and-off again tariffs on imports, efforts by the administration to drive down government borrowing costs, and pressure on the Fed to lower interest rates, have dented markets' trust in the greenback and plunged its value compared to other currencies. To understand what's happening now, and how it will affect U.S. and global multinationals, I spoke to LSE professor Paul De Grauwe, whose early 1990s work on 'chaotic' exchange rates remains a fundamental text for economists today. Here are his takeaways for leaders: This is nothing new. The dollar dropped in value, but it did not do so in a 'phenomenal' way, De Grauwe noted. 'It doesn't worry me.' In fact, the dollar today is trading at about its 10-year average against the euro. And even the drop of about 10% in the past two months isn't anything out of the ordinary. Back in 2017, the dollar dropped twice as much in a year. CEOs were able to adjust then, and they can do so again now, the economist said. For foreign companies, it means 'you'll either have to raise prices, or lower profits,' he said, dryly. 'It is always this way with currencies.' And for U.S. companies, the opposite is true. But in either case, the adjustment will be absorbable, and nothing new under the sun. Don't expect a Mar-a-Lago accord. De Grauwe isn't buying the rumors about a possible 'Mar-a-Lago' accord, where—in accordance with Trump's wishes—global policymakers would help drive down the value of the dollar structurally. 'It is fiction,' he says. Back in the 1980s, the so-called Plaza Accord did achieve that goal, halving the value of the dollar against the Deutsche Mark in the space of a year. But two things will prevent any such plan today. First, the global economy is a lot more diversified, with China and other emerging markets having entered the scene, making effective interventions harder to coordinate. And second, the dollar isn't as overvalued today as it was then, when a belief in the 'wonder of Reagonomics' had doubled the dollar's value in the years leading up to the 1985 Accord. Watch the Treasury. The one place that could stir things up, De Grauwe said, is the Treasury. 'The safe-haven reputation of the dollar is important,' he said. 'The dollar has had this reputation for a long time. But that is now undermined.' More specifically, if the administration ever became serious about forcing a swap between 10-year Treasuries and newly created 100-year ones (the so-called 'forever bond', which today remain a concept only), it could mean the end of the safe haven status of the U.S. dollar, and cause a dramatic fall in its value. For now, he said, that didn't seem likely to happen. But with this administration, predicting the future is, to put it lightly, hard to do. More news below.—Peter Vanham Contact CEO Daily via Diane Brady at This story was originally featured on Sign in to access your portfolio
